California Cities’ Settlement With Gun Industry Distributors, Dealers To Include Major Distribution Reforms, Payment

Herrera says settlement ‘shoots full of holes’ NRA rhetoric about ‘frivolous litigation’

City Attorney Dennis Herrera today announced a groundbreaking settlement agreement in litigation brought by the City and County of San Francisco and eleven other California municipalities against the gun industry that will see two California-based gun dealers and three distributors who sold guns into the state agree to restrictions reaching far beyond current federal and state law. In addition to major reforms in firearm distribution practices that will prevent firearms from being sold into illegal markets in California, the five industry defendants will pay $70,000 to City coffers in exchange for being released from the lawsuit currently pending trial in San Diego County Superior Court.

“Today’s settlement with major players in the gun industry shoots full of holes any rhetoric you may have heard from the National Rifle Association about ‘frivolous litigation,'” said Herrera. “The gun industry has much to do to end reckless business practices that have supplied illicit markets–and they know it. We commend the responsible gun industry businesses who worked with us to reach this just and important settlement. And we hope their leadership serves as an example for the rest of their industry.”

The proposed settlement, which still must be approved by participating jurisdictions and the court, comes at a time when gun industry advocates in the U.S. Senate are gearing up to pass the so-called “Protection of Lawful Commerce in Arms Act” (S. 659), which would provide the gun industry with sweeping legal immunity from most civil lawsuits–including San Francisco’s. The eleven California jurisdictions in addition to San Francisco that are suing the gun industry are Los Angeles County, Alameda County, San Mateo County, and the cities of Los Angeles, Sacramento, Oakland, Berkeley, East Palo Alto, Inglewood, Compton, and West Hollywood.

Gun industry defendants opting for the settlement agreement with the California plaintiffs are Oakland, Calif.-based Traders’ Sports, Inc.; Chapin, S.C.-based Ellett Brothers, Inc.; Lebanon, Ohio-based Southern Ohio Gun Distributors, Inc.; Dayton, Ohio-based MKS Supply Inc. and Southern California gun dealer, Andrew’s Sporting Goods. Among representative reforms accepted by Traders’ Sports, as part of its permanent Consent Decree to be approved and administered by the court, are the following:

  • To refrain from selling firearms at gun shows
  • To implement an enhanced inventory tracking plan to ensure that firearms are not lost or stolen
  • To annually train all employees how to recognize and block sales to straw purchasers
  • To adopt as the store’s policy “to go beyond the law in verifying the identity of the actual purchaser of a firearm”
  • To maintain electronically all firearm trace requests conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives and provide that information, upon request, to gun manufacturers and distributors, which would enable them to monitor the conduct of the dealers who sell their firearms
  • To implement a security plan that locks and secures firearms and ammunition to help prevent theft
  • To go through an extensive firearm safety checklist with each firearm purchaser.

Southern Ohio Gun Distributors similarly agreed to go beyond the law to sell only to storefront gun dealers in California and neighboring states, to take extra steps to verify dealer licenses, to restrict sales of assault weapons, and to pay $50,000 to compensate the plaintiffs for some of the costs of bringing suit. Southern Ohio had sold hundreds of guns to a gun trafficker who falsified a dealer’s license and resold the guns on the street.

In addition to Deputy City Attorneys Owen Clements, Kristine Poplawski and Ingrid Evans of the San Francisco City Attorney’s Office, the twelve California jurisdictions are represented by respective county counsels and city attorneys as well as attorneys from the Brady Center to Prevent Gun Violence, a leading national non-profit dedicated to reducing gun violence in the United States that is chaired by Sarah Brady, wife of former Reagan Presidential Press Secretary Jim Brady. Co-counsel to the Brady Center in the litigation are attorneys from the San Diego, Calif.-based law firm of Milberg, Weiss, Bershad, Hynes & Lerach and the San Francisco-based law offices of Lieff, Cabraser, Heimann and Bernstein. The San Francisco offices of Bingham McCutchen, Cooley Godward, and Thelen Reid & Priest also provided substantial pro bono assistance in the case.


San Francisco’s original lawsuit, filed on May 25, 1999 in San Francisco Superior Court, Case No. 303-753, was later coordinated with similar actions in the San Diego Superior Court as part of J.C.C.P. 4095; entitled People of the State of California ex rel Herrera et al. v. Arcadia Machine & Tool Inc. et al. The litigation charges gun dealers, distributors and manufacturers with contributing to a public nuisance and violating California law by selling guns without ensuring safe sales practices to prevent sales by retailers to straw purchasers and gun traffickers. In a ruling issued on May 2, 2003, the Superior Court of California in San Diego allowed the cases against the dealers and distributors to proceed to trial, set to begin October 10, 2003. The Court dismissed the manufacturer-defendants from the suit, a ruling that recently was appealed by the municipalities.